BCE to convert a portion of its Series AA Preferred Shares into Series AB Preferred Shares
BCE Inc. (TSX, NYSE: BCE) today
announced that 9,918,414 of its 20,000,000 Cumulative Redeemable First
Preferred Shares, Series AA (“Series AA Preferred Shares”) have been tendered
for conversion, on a one-for-one basis, into Cumulative Redeemable First
Preferred Shares, Series AB (“Series AB Preferred Shares”). Consequently, BCE
will issue 9,918,414 new Series AB Preferred Shares on September 1, 2007. The
balance of the Series AA Preferred Shares that will not have been converted
will remain outstanding and will continue to be listed on The Toronto Stock
Exchange under the symbol BCE.PR.A.
The Series AA Preferred Shares will pay on a quarterly basis, for the
five-year period beginning on September 1, 2007, as and when declared by the
Board of Directors of BCE, a fixed dividend based on an annual dividend rate
The Series AB Preferred Shares will pay a monthly floating adjustable
cash dividend for the five-year period beginning on September 1, 2007, as and
when declared by the Board of Directors of BCE. The Series AB Preferred Shares
will be listed on The Toronto Stock Exchange under the symbol BCE.PR.B and
should start trading on a when-issued basis at the opening of the market on
August 28, 2007.
On June 30, 2007, BCE announced that the company has entered into a
definitive agreement for BCE to be acquired by an investor group led by
Teachers’ Private Capital (the private investment arm of the Ontario Teachers’
Pension Plan), Providence Equity Partners Inc. and Madison Dearborn Partners,
LLC. Under and subject to the terms of the definitive agreement, as amended,
the investor group has agreed to acquire all of the outstanding Series AA
Preferred Shares at a price of $25.76 per share and all of the outstanding
Series AB Preferred Shares at a price of $25.50 per share, together, in each
case, with accrued but unpaid dividends to the Effective Date (as such term is
defined in the definitive agreement). Completion of these purchases is, as
with respect to the proposed purchase by the investor group of BCE’s common
shares and the other series of outstanding preferred shares of BCE,
conditional upon obtaining certain approvals, including BCE shareholder
approval and regulatory approval, and satisfying various other closing
conditions. If these approvals are not obtained and the other closing
conditions are not satisfied or waived, then the investor group will not
purchase any shares of BCE, including any of the Series AA or Series AB
The Board of Directors of BCE has received opinions as to the fairness,
from a financial point of view, of the consideration to be paid for the
preferred shares from BCE’s financial advisors.
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